Move to Value-Based Pay Slows: Survey

Rich Daly, HFMA Senior Writer/Editor

Provider advocates plan to push for policies to support more value-based care during the 2017 legislative battle to replace the ACA.

Dec. 8—Medical groups and integrated delivery systems are slowing their shift toward value-based payment, according to a new
survey, even as federal alternative payment models are expected to undergo changes under the Trump administration.

Revenue continued to shift from fee-for-service (FFS) to value-based payments in 2016 among 168 medical groups and health systems that responded to a member survey by AMGA, a medical group trade association. The share of respondents’ federal revenue that came through FFS dropped from 45 percent in
2015, according to a previous
survey, to 40.7 percent in the new survey. The share of revenue garnered from commercial FFS payments declined from 78 percent in 2015 to 77.3 percent in 2016.

However, the general shift came amid indications that FFS payments will make up a larger percentage of revenues in the next three years than was predicted in the 2015 survey. For example, survey respondents projected last year that by 2016, 68 percent of commercial revenue would come
from FFS, an ambitious forecast compared with the 77.3 percent actual figure.

Additionally, expected revenue from more advanced risk-based arrangements, such as shared-risk and partial- or full-capitation agreements, was “significantly” less than predicted in 2015.

Donald Fisher, PhD, president and CEO of AMGA, said in a media call that “the transition to risk is slowing, and there are very real obstacles in the way.”

Although the two surveys mostly included different organizations, the survey report noted that both sets of respondents “represent leadership in very large and complex organizations, and their answers can be relied upon to paint an accurate picture of the risk-bearing landscape and
provide a reasonable basis for comparison.”

Other worrying signs for proponents of value-based payment included a decline in the share of respondents’ commercial payer revenue from shared-risk arrangements (5 percent of revenue in 2015, 4.4 percent in 2016). However, a larger percentage anticipated they would be ready to take on shared risk within
the next two years.

“So our members are getting more ready, while facts on the ground appear to be slowing down,” Chester Speed, vice president of public policy with AMGA, said in the media call.

Positive signs for advocates of value-based pay included an increase in the share of federal revenue received through various types of accountable care organizations (ACOs) from 11 percent in 2015 to 15.2 percent in 2016.

Overcoming Obstacles

As described in the survey, obstacles preventing more practices from increasing their reliance on value-based revenue included the low number of commercial insurers that offer such contracts and the infrequent sharing of administrative claims data.

Among steps AMGA urged Congress to take to help was enacting requirements that insurers provide access to all administrative claims data and that data-reporting processes be standardized, and allowing Track 1 Medicare Shared Savings Program ACOs—which are the vast majority of Medicare ACOs—to
qualify as advanced alternative payment models (APMs). Qualifying as APMs would allow participating physicians to garner a 5 percent annual incentive payment under Medicare’s new physician payment system.

Members of Congress have been receptive to AMGA’s requests to require that insurers provide claims data and to bolster commercial insurers’ value-based payment offerings, Speed said.

“Obviously the state of play is the ACA [the Affordable Care Act] and what happens there, but there are going to be some significant opportunities for general healthcare issues and MACRA changes later on in the year, I believe, which is when we would attempt to put this in legislative
language,” Speed said.

Federal Value Focus

On Dec. 8, the Centers for Medicare & Medicaid Services (CMS) proposed two new payment models aimed at increasing patient engagement in care decisions by giving Medicare beneficiaries more information, according to a CMS
blog post.

The Shared Decision Making and Direct Decision Support models will test different approaches to shared decision making.

“These models will look to move beyond current practices and examine new ways to engage with patients with regard to their health and health care, and hopefully increase quality of care delivered, increase patient satisfaction, and provide value in the cost of care delivered,” wrote Patrick
Conway, MD, principal deputy administrator for CMS, and Andy Bindman, MD, director of the Agency for Healthcare Research and Quality.

The federal government’s efforts to push more providers to adopt value-based payment are expected to continue under the incoming Trump administration. However, some important changes could be included.

Mark Weller, a partner at Dentons and a former legislative director for Sen. Richard Lugar (R-Ind.), said at a Dec. 7 briefing that the Trump administration and GOP-led Congress were expected to continue to support Medicare’s use of ACOs and bundled payment models, for instance.

Some observers have noted that the U.S. Department of Health and Human Services (HHS) may move away from mandatory bundled payment models under Rep. Tom Price (R-Ga.), whom Trump nominated as secretary. That expectation stems from Price’s explicit call for CMS to discontinue use of
mandatory models, such as the proposed Part B drug pilot.

It is also unclear whether a potentially more consumer-directed focus for Medicare will undermine payment models that patients usually don’t know they are a part of. In addition, GOP leaders have announced their intention to push for a premium support approach for Medicare enrollees,
which would move the program from a defined benefit to a defined contribution.

Despite an expectation ACOs will get support, Jeff Hamling, a senior managing director at Dentons and former deputy chief of staff for Price, cautioned that there is potential for large healthcare policy shifts as Republicans seek to replace the ACA, which means ACO leaders need to
communicate their successes to members of Congress to avoid having those programs be targeted for elimination.. Such advocacy also could help eliminate some of the logistical barriers that have impeded ACOs’ success, such as concerns about drawing antitrust enforcement.

Provider advocates plan to push for policies to support more value-based care during the 2017 legislative battle to replace the ACA.

Dec. 8—Medical groups and integrated delivery systems are slowing their shift toward value-based payment, according to a new
survey, even as federal alternative payment models are expected to undergo changes under the Trump administration.

Revenue continued to shift from fee-for-service (FFS) to value-based payments in 2016 among 168 medical groups and health systems that responded to a member survey by AMGA, a medical group trade association. The share of respondents’ federal revenue that came through FFS dropped from 45 percent in
2015, according to a previous
survey, to 40.7 percent in the new survey. The share of revenue garnered from commercial FFS payments declined from 78 percent in 2015 to 77.3 percent in 2016.

However, the general shift came amid indications that FFS payments will make up a larger percentage of revenues in the next three years than was predicted in the 2015 survey. For example, survey respondents projected last year that by 2016, 68 percent of commercial revenue would come
from FFS, an ambitious forecast compared with the 77.3 percent actual figure.

Additionally, expected revenue from more advanced risk-based arrangements, such as shared-risk and partial- or full-capitation agreements, was “significantly” less than predicted in 2015.

Donald Fisher, PhD, president and CEO of AMGA, said in a media call that “the transition to risk is slowing, and there are very real obstacles in the way.”

Although the two surveys mostly included different organizations, the survey report noted that both sets of respondents “represent leadership in very large and complex organizations, and their answers can be relied upon to paint an accurate picture of the risk-bearing landscape and
provide a reasonable basis for comparison.”

Other worrying signs for proponents of value-based payment included a decline in the share of respondents’ commercial payer revenue from shared-risk arrangements (5 percent of revenue in 2015, 4.4 percent in 2016). However, a larger percentage anticipated they would be ready to take on shared risk within
the next two years.

“So our members are getting more ready, while facts on the ground appear to be slowing down,” Chester Speed, vice president of public policy with AMGA, said in the media call.

Positive signs for advocates of value-based pay included an increase in the share of federal revenue received through various types of accountable care organizations (ACOs) from 11 percent in 2015 to 15.2 percent in 2016.

Overcoming Obstacles

As described in the survey, obstacles preventing more practices from increasing their reliance on value-based revenue included the low number of commercial insurers that offer such contracts and the infrequent sharing of administrative claims data.

Among steps AMGA urged Congress to take to help was enacting requirements that insurers provide access to all administrative claims data and that data-reporting processes be standardized, and allowing Track 1 Medicare Shared Savings Program ACOs—which are the vast majority of Medicare ACOs—to
qualify as advanced alternative payment models (APMs). Qualifying as APMs would allow participating physicians to garner a 5 percent annual incentive payment under Medicare’s new physician payment system.

Members of Congress have been receptive to AMGA’s requests to require that insurers provide claims data and to bolster commercial insurers’ value-based payment offerings, Speed said.

“Obviously the state of play is the ACA [the Affordable Care Act] and what happens there, but there are going to be some significant opportunities for general healthcare issues and MACRA changes later on in the year, I believe, which is when we would attempt to put this in legislative
language,” Speed said.

Federal Value Focus

On Dec. 8, the Centers for Medicare & Medicaid Services (CMS) proposed two new payment models aimed at increasing patient engagement in care decisions by giving Medicare beneficiaries more information, according to a CMS
blog post.

The Shared Decision Making and Direct Decision Support models will test different approaches to shared decision making.

“These models will look to move beyond current practices and examine new ways to engage with patients with regard to their health and health care, and hopefully increase quality of care delivered, increase patient satisfaction, and provide value in the cost of care delivered,” wrote Patrick
Conway, MD, principal deputy administrator for CMS, and Andy Bindman, MD, director of the Agency for Healthcare Research and Quality.

The federal government’s efforts to push more providers to adopt value-based payment are expected to continue under the incoming Trump administration. However, some important changes could be included.

Mark Weller, a partner at Dentons and a former legislative director for Sen. Richard Lugar (R-Ind.), said at a Dec. 7 briefing that the Trump administration and GOP-led Congress were expected to continue to support Medicare’s use of ACOs and bundled payment models, for instance.

Some observers have noted that the U.S. Department of Health and Human Services (HHS) may move away from mandatory bundled payment models under Rep. Tom Price (R-Ga.), whom Trump nominated as secretary. That expectation stems from Price’s explicit call for CMS to discontinue use of
mandatory models, such as the proposed Part B drug pilot.

It is also unclear whether a potentially more consumer-directed focus for Medicare will undermine payment models that patients usually don’t know they are a part of. In addition, GOP leaders have announced their intention to push for a premium support approach for Medicare enrollees,
which would move the program from a defined benefit to a defined contribution.

Despite an expectation ACOs will get support, Jeff Hamling, a senior managing director at Dentons and former deputy chief of staff for Price, cautioned that there is potential for large healthcare policy shifts as Republicans seek to replace the ACA, which means ACO leaders need to
communicate their successes to members of Congress to avoid having those programs be targeted for elimination.. Such advocacy also could help eliminate some of the logistical barriers that have impeded ACOs’ success, such as concerns about drawing antitrust enforcement.

HFMA RESOURCE LIBRARY

Patient financial engagement is more challenging than ever – and more critical. With patient responsibility as a percentage of revenue on the rise, providers have seen their billing-related costs and accounts receivable levels increase. If increasing collection yield and reducing costs are a priority for your organization, the metrics outlined in this presentation will provide the framework you need to understand what’s working and what’s not, in order to guide your overall patient financial engagement initiatives and optimize results.

No two patients are the same. Each has a very personal healthcare experience, and each has distinct financial needs and preferences that have an impact on how, when and if they chose to pay their healthcare bill. It’s no longer effective to apply static billing techniques to solve the complex challenge of collecting balances from patients. The need to tailor financial conversations and payment options to individual needs and preferences is critical. This presentation provides 10 recommendations that will not only help you improve payment performance through a more tailored approach, but take control of rising collection costs.

This white paper, written by Apex Vice President of Solutions and Services, Carrie Romandine, discusses the importance of patient segmentation and messaging specifically related to the patient revenue cycle. Applying strategic messaging that is tailored to each patient type will not only better educate consumers on payment options specific to their billing needs, but it will maximize the amount collected before sending to collections. Further, targeted messaging should be applied across all points of patient interaction (i.e. point of service, customer service, patient statements) and analyzed regularly for maximized results.

This white paper, written by Apex President Patrick Maurer, discusses methods to increase patient adoption of online payments. Providers are now seeking ways to incrementally collect more payments due from patients as well as speeding up the rate of collections. This white paper shows why patient-centric approaches to online payment portals are important complements to traditional provider-centric approaches.

Increased electronic engagement between healthcare providers and patients provides significant opportunities for improving revenue cycle metrics and encouraging patients to access EHRs. This article, written by Apex Founder and CEO Brian Kueppers, explores a number of strategies to create synergy between patient billing, online payment portals and electronic health record (EHR) software to realize a high ROI in speed to payment, patient satisfaction and portal adoption for meaningful use.

Faced with a rising tide of bad debt, a large Southeastern healthcare system was seeing a sharp decline in net patient revenues. The need to improve collections was dire. By integrating critical tools and processes, the health system was able to increase online payments and improve its financial position. Taking a holistic approach increased overall collection yield by 10% while costs came down because the number of statements sent to patients fell by 10%, which equated to a $1.3M annualized improvement in patient cash over a six-month period. This case study explains how.

To maintain fiscal fitness and boost patient satisfaction and loyalty, healthcare providers need visibility into when and how much they will be paid–by whom–and the ability to better navigate obstacles to payment. They need payment clarity. This whitepaper illuminates this concept that is winning fans at forward-thinking hospitals.

Financial services staff are always looking for ways to improve the verification, billing and collections processes, and Munson Healthcare is no different. Read about how they streamlined the billing process to produce cleaner bills on the front end and helped financial services staff collect more than $1 million in additional upfront annual revenue in one year.

Effective revenue cycle management can be a challenge for any hospital, but for smaller providers it is even tougher. Read how Wallace Thomson identified unreimbursed procedures, streamlined claims management, and improved its ability to determine charity eligibility.

Before launching an energy-efficiency initiative, it’s important to build a solid business case and understand the funding options and potential incentives that are available. Healthcare leaders should consider taking the steps outlined in the whitepaper to ease the process of gaining approval, piloting, implementing, and supporting sustainability projects. You will find that investing in sustainability and energy efficiency helps hospitals add cash to their bottom line. Discover how hospitals and health systems have various options for funding energy-efficient and renewable-energy initiatives, depending on their current financial structure and strategy.

Health care is a dynamic mergers and acquisitions market with numerous hospitals and health systems contemplating or pursuing formal arrangements with other entities. These relationships often pose a strategic benefit, such as enhancing competencies across the continuum, facilitating economies of scale, or giving the participants a competitive advantage in a crowded market. Underpinning any profitable acquisition is a robust capital planning strategy that ensures an organization reserves sufficient funds and efficiently onboards partners that advance the enterprise mission and values.

The success of healthcare mergers, acquisitions, and other affiliations is predicated in part on available capital, and the need for and sources of funding are considerations present throughout the partnering process, from choosing a partner to evaluating an arrangement’s capital needs to selecting an integration model to finding the right money source to finance the deal. This whitepaper offers several strategies that health system leaders have used to assess and manage capital needs for their growing networks.

Announcements from several commercial payers and the Centers for Medicare and Medicaid Services (CMS) early in 2015 around increased efforts to form value-based contracts with providers seemed to point to an impending rise in risk-based contracting. Rather than wait for disruption from the outside in, health care providers are now making inroads on collaborating with payers on various risk-based contracting models to increase the value of health care from within.

Yuma Regional Medical Center (YRMC) is a not-for-profit hospital serving a population of roughly 200,000 in Yuma and the surrounding communities.
Before becoming a ZirMed client, Yuma was attempting to manually monitor hundreds of thousands of charges which led to significant charge capture leakage. Learn how Yuma & ZirMed worked together to address underlying collections issues at the front end, thus increasing Yuma’s overall bottom line.

Kindred Hospital Rehabilitation Services works with partners to audit the market and the facility’s role in that market to identify opportunities for improvement. This approach leads to successes; Kindred’s clinical rehab and management expertise complements our partners’ strengths. Every facility and challenge is unique, and requires a full objective analysis.

Qualified coders are getting harder to come by, and even the most seasoned professional can struggle with the complexity of ICD-10. This 5-Minute White Paper Briefing explains how partnerships can help improve coding and other key RCM operations potentially at a cost savings.

The point of managing your revenue cycle isn’t just to improve revenue and cash flow. It’s to do those things effectively by consistently following best practices— while spending as little time, money, and energy on them as possible.

The reasons claims are denied are so varied that managing denials can feel like chasing a thousand different tails. This situation is not surprising given that a hypothetical denial rate of just 5 percent translates to tens of thousands of denied claims per year for large hospitals—where real‐world denial rates often range from 12 to 22 percent. Read about how predictive modeling can detect meaningful correlations across claims denials data.

Emergency Mobile Health Care (EMHC) was founded to be and remains an exclusively locally owned and operated emergency medical service organization; today EMHC serves a population of more than a million people in and around Memphis, answering 75,000 calls each year.

Since the Physician Quality Reporting Initiative (PQRI) introduction, CMS has paid more than $100 million in bonus payments to participants. However, these bonuses ended in 2015; providers who successfully meet the reporting requirements in 2016 will avoid the 2% negative payment adjustment in 2018, so now is the time to act! Included in this whitepaper are implications of increasing patient responsibility, collections best practices, and collections and internal control solutions.

Getting paid what your physician deserves—that’s the goal of every biller. Yet even for the best billers, achieving that success can be elusive when denials stand in the way of success, presenting challenges at every turn. Denials aren’t going away, but you can learn techniques to manage and even prevent them.Join practice management expert Elizabeth W. Woodcock, MBA, FACMPE, CPC, to: Discover methods to translate denial data into business intelligence to improve your bottom line, determine staff productivity benchmarks for billers, and recognize common mistakes in denial management.

Read more about factors contributing to the changes in the post-acute marketplace and what it means for manufacturers, physicians, clinicians, patients, and post-acute facilities as they anticipate the transition to the second curve.

HSG helped the physicians and executives of St. Claire Regional in Morehead, Kentucky, define their shared vision for how the group would evolve over the next decade. As well as, develop the strategic and operational priorities which refocused and accelerated the group’s evolution.

The client was a nine-hospital health system with 14 clinics serving communities in a multi-state market with very limited access to care, poor economic conditions, high unemployment, and a heavy Medicare/Medicaid/uninsured payer mix. In most of these communities, the system was the sole source of care.
Though the clinics were of substantial size (they employed 98 physicians) and comprised of multiple specialists, the physicians functioned as individuals and the practices lacked any real group culture.

Clinical integration can be expensive, but it doesn’t have to be, as this four-step road map for developing a CIN proves. Does it have to cost millions to initiate a clinical integration strategy?
Contrary to popular belief, we have clients who have generated substantial shared savings and a significant ROI over time, without massive investments. Yes, some financial capital is required for resources the CIN providers can’t bring to the table themselves. But the size of that investment can be miniscule relative to the value it produces: improved outcomes and documentation for payers.

Today’s concerns about physician compensation are the result of the changing healthcare environment. The transition to value is slow, but finally becoming a reality. Proactive hospitals want to ensure that provider incentives are properly aligned with ever-increasing value-based demands.
This report focuses on the three big questions HSG receives about adding value to physician compensation; Why are organizations redesigning their provider compensation plans? What elements and parameters must be part of successful compensation plans? How are organizations implementing compensation changes?

Revenue Cycle Management has become an even more complex issue with declining reimbursements, implementation of Electronic Health Records, evolving local carrier determinations (LCD), and payer credentialing [The emphasis on healthcare fraud, abuse and compliance has increased the importance of accuracy of data reporting and claims filing).
The efficiency of a medical practice’s billing operations has critical impact on the financial performance. In many cases, patient billings are the primary revenue source that pays staff salaries, provider compensation and overhead operating cost. Inefficiencies or inaccurate billing will contribute to operating losses.

This publication identifies and outlines the necessary characteristics of a fully-functioning clinically integrated network (CIN). What it doesn’t do is detail how hospitals and providers can participate in the value-based care environment during the development process.
One common misconception is that the CIN can’t do anything significant until it has obtained the FTC’s “clinically integrated” stamp of approval. While the network must satisfy the FTC’s definition of clinical integration before single signature contracting for FFS rates and contracts can legally start, hospitals and providers can enjoy three key benefits during the development process.

Nearly half of all Medicare beneficiaries treated in the hospital will need post-acute care services after discharge. For these patients, a stay in an inpatient rehabilitation facility, skilled nursing facility or other post-acute care setting comes between hospital and home.

With the proper process, tools, and feedback mechanisms in place, budgeting can be a valuable exercise for organizations while helping hold organizational leaders accountable. Having a proper monthly variance review process is one of the most critical factors in creating a more efficient and accurate budget. Monthly variance reporting puts parameters around what is to be expected during the upcoming budget entry process.

Managing the cost of patient care is the top strategic priority of most hospital CFOs today. As healthcare shifts to more data-driven decision making, having clear visibility into key volume, cost and profitability measures across clinical service lines is becoming increasingly important for both long-range and tactical planning activities. In turn, the cost accounting function in healthcare provider organizations is becoming an increasingly important and strategic function. This whitepaper includes five strategies for efficient and accurate cost accounting and service line analytics and keys to overcoming the associated challenges.